Camera components represent 9.5% of total iPhone 7 material cost

Analyst firm Chipworks-TechInsight has published its iPhone 7 reverse engineering report, which includes some interesting cost and technology information for more engineering-minded photographers. The analysts estimate the total bill of materials for the iPhone 7 with 128GB of built-in memory to be $275. $26, or approximately 9.5%, of that total sum are spent on camera and imaging components. This includes the Sony-made Exmor RS image sensors and lenses in front and rear cameras and all processing hardware.

The most expensive component in the device, that retails in the US for $749, is Apple's A10 Fusion CPU at $40. The display and touchscreen add $37 to the cost. Given how advanced smartphone camera technology has become, it is surprising that it only represents a relatively small percentage of the total cost of a device (though Apple is famous for its high margins.)

We'd expect the dual-cam in the iPhone 7 Plus to be quite a bit more expensive than the single-lens version in the standard iPhone 7. However, Chipworks has to publish its report on the larger iPhone model. For now, you can download the iPhone 7 report on Chipworks website if you're happy to provide your contact information and email.

Comments

Awesome. So next time someone asks the stupid question of why someone will spend $700 on a phone but not a camera, we can point to the fact that the camera on its own would only be ~$100-200 (needs a screen, case, battery etc)

What most people don't understand (or just pretend) is that for making a mobile phone, a company don't invest only in parts.Behind the process, there is much more work and costs. For example, there is a lot of research to make the mobile every time better, engineers and designers works to create the hardware side, developers, analysts and tester works on making and improving the software, then there are costs for assembling, production line, packaging, shipping, customer service and back office assistance. And I'm sure I forgot many things.

This is good news.First, the margins are pretty standard, after all, the smartphone is more software than hardware and software is what created the smartphone and killed Nokia and Microsoft in that market.Then, 20$ per camera module mean that 3x3 camera arrays have become an economically viable option. Still 180$ per array, but feasible for, say a Plus model. The competition for smartphone camera modules also is what made multi module cameras like the 36-camera Panono a reality.

"though Apple is famous for its high margins"that is true, however let's not forget that apple makes it's own software (OS + apps) while the android manufacturers only improve different features over the standard android (mostly UI and features no one needs and no one wants) ... so yeah, that's a lot of money that have to go in the final price.

Not saying their margin isn't high still, but just that it's normal to be a higher margin that samsung for example, if you look only at the hardware price.

26 dollar divided by 2 camera's (ok 1 slightly better than the other) so lets say a max. 20 dollar prod. costs camera. Lets throw in some other components to make it a normal camera and some software.....25 dollar max. That would be sold for around 150-200 dollar. A budget camera indeed.

The $26 / 9.5% is maybe a bit misleading:AFAICT, that figure would indicate what Apple would save on the BOM if it deleted the Cameras.It doesn't say how much lower the BOM would be if the phone were designed without cameras. Some of the remaining system cost is attributable to related systems, and common infrastructure.On the A10 SoC, the Apple ISP, and the 4kp30 encoder seem camera related. If the video encoder is system-efficient, it likely includes a big SRAM for motion prediction.In addition, consider:- Camera physical & logical interfaces- Memory/bus capacity for cameras and related subsystems- Display/composition subsystem capacity to scale & composit 4kp30 video- Main CPU capacity to manage the above- Power supply & management capacity to support 4kp30 - including battery- Cost of software to manage all this.A fancy ISP is no use without a driver co-developed with the RTL ("hardware").

I'd attribute another $10-ish of BOM to cameras, for maybe $35 or about 13%.

DPR just meant about "Camera" sensor module costs. they didnt mean about all the Camera Systems needed during processing photos or videos. $26 camera module is not really impressive for a phone which set to earn at least 400$ per device since they could spend a few $$ more to get better camera than s7 edge.

It's probably in the ball-park of what the parts for a small-sensor compact camera cost, as remember they still need a processor, screen, case, controls and if you work backwards from the selling price you're not likely to get more than $26 for sensor+lens.

Why are people wondering ? Loudspeakers for example made in China that a distributor would pay 36 usd are sold for 400 to the end consumer in Europe , and those 36 USD are not even the real costs of the speakers ..... many people have no idea....

if i had to guess a meaningful percentage of the utility and importance to the average apple user of the camera part of the i phone i would say it surely is more than about 9 .5% ....sadly for photography the i phone is the defacto and ONLY camera many own and it seems will ever own...

when you spend a total of 26 dollars for a sensor, a processing path ,& a stack of plastic lenses, you end up with a sorry excuse for a camera ..

imagine a proper sensor of 30 to 50 sqmm ? instead of less than18 iphones have which is entirely possible ...... imagine a decent glass lens??? other do it with great success to the embarrassment of the iphone ....apple does the least it can get away with...

to their credit they do alot with that 26 dollars .... i think they've optimized and squeezed every ounce of goodness from their components... and been efficient and done a good job with things like whit bal...just imagine

How we aloud to corporate rip of scum like Apple to over charging us. We should pres our politicians to stop corporate scum to ripping us of. Rumor sagest that iPhone bring to Apple close to $600 billions. How is that possible. If it is true that sagest that Apple is noting more then rip of scum. We should openly boycott rip of Apple...(unbelievable $600 billion profit...).

How's this any different from another industry, like for instance, diamond? You didn't really think that a piece of shiny rock that DeBeers didn't even "make" but just dug off the ground, cut, polished and marketed as the greatest thing since slice bread--is really worth a man's 3-month salary did you?

To say nothing of distribution, staffing, stores, rent/leases, utilities, warranty, cost of keeping stock on hand, display units that get damaged, shelving/stands for stores, packaging, advertising/marketing, staff uniforms/shirts, insurance, and on and on and on...

But welcome to the interwebs where so much has been written by so many with so little knowledge of what they are writing/commenting about.

To the folks thinking an iPhone 7 should be sold for a few bucks over build cost, the next time you walk into ANY store or commercial entity, start doing some quick maths and add up those things,.

Mr. Heyltsjoel, He is not mocking you, he just do not know what is talking about. If you consider that apple make over 250 billion last year sagest that they rip us of big time. Goofy idiot Mr. "Interestingness" think it is ok to pay $600 for iPhone 5, and $1000 for iPhone 6. Because we have those idiots with distorted perception, the rip of corporate scum do not hesitate to over charge us. The sad think is that our be-loving government aloud to corporation to use mafia methodology of charging.....

@HeyItsJoel - hardly! I am mocking the armchair MBA's who think they know what they are talking about though. Good thing most of these folks don't actually run a company, it would be bankrupt in no time.

Besides if ya didn't have the rabid consumer demand to rock a wicked-high 33% EBITDA margin, how would ya get the cash to so-totally-disrupt the watch & automotive industries, build-out a colossal castle of an office (just our humble HR strategy, ya know?), and sell your cool-aid drinking investors on how you're gonna save the world through renewable energy? Consumers should be THANKING Apple for these high prices!

Which is why Tim Cook is Apple's CEO; but there is a huge cost in coming out with a working ecosystem, including a stable, user friendly OS, the right incentives for Apps, filtering and managing them, beyond the device's design and engineering, and the risk of the whole project. How many of these has Samsung aka Kaboom! mastered? Google itself? I don't even use an iPhone, but there needs to be some recognition where it's deserved, particularly for a company who almost went down several times following these notions.

never heard that rumor but totally possible...when I talked to some Nokia engineers a couple of years back they basically admitted that the 1020 was simply to expensive...one of the reasons why it was a commercial failure.

Is that to do with assembly, as that error rate on a wafer would make larger sensors unmanufacturable, and at these volumes they must be using the latest and greatest processes?I'm afraid I don't find that believable without some more info, sorry.Also if they are paying $26 for sensor + attached lens + flexi at 14% yield that's $3.64 sale cost per module so manufacturing cost will start with a 1.

A "camera module" is a sensor and lens assembly. The lenses are each double-sided aspherics with very poor alignment tolerances. The lens elements are very difficult to reliably fabricate, and then they are very difficult to align. The yield for the iPhone 5 camera module was 14%; I do not expect it has gone up with the increasing complexity.

You can find reports on these things in the IEEE Photonics journal, or in papers at the international optical design conference, IODC.

By "assembly" I did mean the whole module, as I explained why I thought it wasn't the chip. I also assume at 14% they just keep throwing lenses on top of them until it passes. Certainly back when I was looking at buying modules (and the company was buying modules) the prices couldn't support those yields as we were using quite expensive 1/3.2" sensors and we knew what the sensors cost alone (the modules not coming from the sensor company).

I think most people don't understand that once you reach a certain quantity, any further discounts are just a fraction of a cent.

Apple sells more phones than Samsung does, but they both sell in the tens of millions. They both get the same, or very similar volume discounts.

This is why small car companies like Suzuki or Kia can compete with Toyota. Toyota certainly does sell more, but once you order 50,000 of anything, you are paying the rock bottom price, and it doesn't get very much better if you order 500,000.

If Samsung made 3 million Note 7s that fast after the launch I'm pretty sure the iPhone 7 will be in 8 figures over the first year. (Although discounts get pretty small after 10k units a week usually.)

Don't forget the software, the included warranty for physical failures, the continuous software development, salaries, future R&D coverage, etc. I don't have an iPhone nor plan to get one, but I'm just being realistic about the costs. As someone said above, "There's a lot more to costs than BOM". And sure, they want to make a profit too.

The "glacier" bottled water that is "sooo good" for you will costs you $10 to $25 for a gallon, the production and distribution cost is around $0.50/gallon.Yet, everyone is outraged at Apple's profits or Arco/Texaco for making $0.04 on $3.00/gallon gasoline. Where is the common sense?

Bingo. Unlike Samsung, Apple doesn't slap a freely available OS into their phone. They ship a custom-developed, highly integrated OS they've developed in-house. (Highly integrated both to the phone's hardware and to their desktops' hardware and software.) That kind of engineering does *not* come cheap.

Don't get me wrong: I hate pretty much everything about the iPhone, but the price itself isn't actually unreasonable, all things considered. *Someone* has to pay for Apple's engineers' $2000/month studio apartments in Silicon Valley. ;-)

the S7 RRP is similar to the iPhone 7 but not the street price, that's what Apple is really quite brilliant at, sticking to the RRP and still selling boatloads of their devices. All other devices have ludicrous RRPs but a couple of months after launch a good chunk of that is knocked off...

It just goes to show how overhyped the iPhone has become, although it does appear that the buying public is catching on as iPhone sales are now well past the peak. Much like the iPad, which has been in decline for quite some time, expect a shrinking and ever older, clientele for the iPhone. Less hip and more likely to break a hip.

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